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A Fortune 100 company reached out to one of our advisors looking for technology that was right in our wheel house. We didn't yet have a product but we had the technical underpinnings of a product. I think when they first agreed to talk to us they thought it would just be a way to educate some of their engineers on state of the art techniques in our field. Sort of continuing education for their staff. But we threw together a demo in a week and it impressed them enough that we kept talking and the tone shifted to the potential for a commercial relationship. We put together a few more custom demos and got them to the point where they believed we could deliver technologically. From there we went to a 3-month trial where we gave them the "real product" but only on about 1/10th of their full data. I think we charged about $15k/month for that. The trial was a success and it came time to iron out the full-blown contract. This was a huge ordeal. Because they had so much leverage in the relationship, they threw every awful thing you can imagine in the contract. The negotiation process was stressful and got pretty nasty at points. We caved on many things but held firm on a couple and actually had to walk at one point. They played dead for a couple weeks and then came back to the table. It took about 4 or 5 months to get it over the finish line and we were able to get them to pay the trial fee for all of the months the contract was in limbo (that felt like a big win). The contract was worth just north of $1M and in retrospect I think we got a good deal. What did we do right? We came in very high on price initially and that helped us settled on the higher end. What did we do wrong? We probably fought more than we should have on some of the terms since now we know they were mostly just CYA. It would have been nice to have wrapped it up much more quickly.

In short: takes forever, prepare for pain due to power inequality, and aim high on price.


If you don't mind me asking, how much higher was your initial price?


About 3x that.


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